Pacific Health Corp. to close 3 hospitals in Southern California

by Corey Moore with AP

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Pacific Health Corp. officials say they'll close the company's three remaining hospitals, in part because of legal costs associated with allegations the company recruited homeless people to charge Medicare and Medi-Cal for care they didn't need.

"It’s urgent care, it’s emergency," the woman said. "We live in this area, so it’s convenient for us; [her son] hurt his leg so we were trying to get an x-ray to make sure he didn’t break anything.”

The closures will have a ripple effect, said Annie Park, a policy director at the nonprofit Community Health Councils in South L.A.

“Whenever a hospital closes that serves a proportion of uninsured or underinsured patients, we always worry about where these patients are going to go and what’s going to happen to them,” Park said.

The three hospitals that are closing provide more than 500 patient beds. A Pacific Health spokesman said 1,300 workers could be laid off.

In August, Pacific Health agreed to pay $16.5 million in a scheme in which the company allegedly engaged in an illegal kickback scheme to recruit homeless people from Los Angeles' Skid Row to become patients at the hospital, where some received unnecessary treatment. The hospitals then submitted claims to to Medicare and Medi-Cal.

As part of the settlement, PHC's Los Angeles Doctors Hospital pleaded guilty to conspiracy in the illegal kickback scheme.